Federal Reserve Chairman Ben Bernanke said on Tuesday that a U.S. shadow banking system that let banks package loans into securities is likely to be smaller and simpler when the current crisis eases.

I imagine that the shadow banking system, at least in the medium-term, will not return to the size it was before, Bernanke said in response to questions after an address at a Brookings Institution conference.

The changes in accounting standards, the regulatory standards, will reduce the benefits to off-balance sheet type of lending by banks, Bernanke said.

(Reporting by Glenn Somerville, Editing by Chizu Nomiyama)

Ben Bernanke